Consulting a lawyer before signing a contract or buy a home in Florida may help avoid trouble. The information contained in this letter is designed to help educate you about the process of buying a home in Florida. The Purchase and Sale Contract Once a buyer selects a home to purchase, the first paper given to the prospective buyer is the purchase and sale contract. This paper is one of the most important steps in buying a home. This paper is one of the most important steps in buying a home. This contract describes what you buy and determines how you buy. Before signing a contract, read it carefully and discuss it with a lawyer. If you want to sign the contract immediately because you are concerned that someone else might purchase the property, make your contract contingent upon your attorney's review and approval within a certain time period. As a buyer, you may want to make sure you have the right to choose the place of closing. It may save you money if you close at your attorney's office. Before You Sign A Contract, Make Sure You Know: Exactly what land, buildings, furnishings and fixtures are included in your offer or the contract. Are the stove, refrigerator, lighting fixtures, etc. included? Exactly what is expected of you concerning payment or financing? Know when you can take possession. Know whether or not there are any easements or other instruments or documents which might affect your title. Know which costs you're responsible for. Typical closing costs include examination of title insurance, survey, termite inspection, construction inspection, intangible tax on the mortgage, loan closing cost, repair costs if any are necessary, broker fees and attorney fees. Property Titles and Title Insurance When purchasing a home, you should require "marketable" title to your property. Your lawyer, after proper investigation, can tell you whether the seller is able to convey such a title to you. No one can advise you without a proper investigation. You should remember that is you are closing at a title insurance company, the title insurance company does not represent you. It is merely acting as a closing agent. This may also be the case if you are closing at an attorney's office. Be sure to know whether you are being represented before you close. Title defects have a way of lying dormant for years and perplexing a buyer long after he has paid for the land, and after the seller is dead or gone. Your lawyer can examine the applicable title information to determine who owns land, defects in or claims against the ownership, and any action needed to secure good record title. This is not a simple operation. It requires interpreting numerous deeds, mortgages, wills, court decrees, and other instruments; considering the consequences of the timing of transactions and events affecting the title and applying laws and court decisions to the various situations revealed by the applicable title information. When you obtain title to a piece of real property, you should obtain an owner's policy of title insurance. In such a policy, the title insurance company contracts with the insured person named in the policy to protect the title as insured against financial loss and the cost of defending the title in court. Like any insurance policy, however, the coverage is no greater than is stated in the policy. Any policy can list matters substantially affecting title which are exceptions to the coverage and are not insured. A mortgagee or lender's insurance policy only protects the holder of the mortgage and not you as the owner. A lawyer representing your interest can advise you of the extent of protection given by your owner's policy. Some lawyers include the policy's cost in an overall cost for legal services. When lawyers do this and charge you a promulgated rate for the title insurance policy, then you are in effect receiving legal services and advice for the same cost as using a title insurance company to close your transaction. A partial promulgated rate schedule is listed below. A promulgated rate is the minimum amount that any title insurance company or attorney's office can charge for issuing a title insurance policy. The promulgated rate is based on the purchase price of the home or the amount of the loan. As a buyer, it is particularly important that you have legal representation at your closing to ensure that you are obtaining clear marketable title to you property. If the home you are buying is still under construction or has completed recently, you must take special care to make sure that all building costs have been paid for the seller and you are fully protected under the provisions of the Florida Mechanics and Materialmen's Lien Law. An attorney can advise you of your rights and responsibilities under this law. The failure to protect yourself against mechanic's liens can result in the property being subject to liens even though the full contract price is paid. Special care should also be taken when a house has been repaired recently or when building materials have recently been delivered.
As a careful buyer, you should insist that you lawyer be present at the closing, checking each detail. Your lawyer will know which points are significant in making your purchase the trouble free ownership to which you are entitled.